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Articles from 2004 In February

National Deviations to IEC 60601-1

After the target markets have been established for a medical device, it is critical to review the relevant national deviations to IEC 60601-1. Understanding these deviations enables manufacturers to define the necessary tests and develop a test plan that ensures smooth market entry. 

Leonard Eisner
Robert M. Brown
Dan Modi

A previous article, “A Primer for IEC 60601-1” (MD&DI, September 2003, p. 48) presented an overview of this International Electrotechnical Commission standard and reviewed its importance. This article details some national deviations to IEC 60601-1 and identifies differences between it and the national standards with deviations (see Figure 1).

Because of the national differences, medical device manufacturers need to design and test their products to the worst-case conditions of the tests that apply to the markets in which the products will be sold. Therefore, before completing the design, identifying the target markets for the device is critical. At the design stage, manufacturers should identify all of the compliance tests applicable to the product and necessary for regulatory approval. 

IEC 60601 and National Standards

The base standard IEC 60601-1 has been adopted in some form in most major countries (see Table I). The standard, either with national deviations (e.g., JIS T 0601-1 in Japan) or in its orginal form (e.g., in Brazil) is accepted in nearly all markets for supporting regulatory registrations and approvals.

National Deviations. Many national standards are based on IEC 60601-1; however, these standards may contain national deviations. Common deviations include the requirements of the electrical code of the particular country, another national standard that may apply to the product type or its components, and different national component requirements (e.g., modified marking requirements).

Based on national requirements, a national standards-writing body may determine that the international standard is adoptable only by modifying, deleting, or adding requirements. Once the national deviations are made to the standard and the national version of the standard is adopted, the package becomes a national standard with national deviations to IEC 60601-1.

Different Perspectives

Figure 1. IEC 60601–1 and national standards with deviations (Click to enlarge).

Fire has long been identified as a major safety hazard in the United States, where many buildings are constructed of  wood. The Great Fire in 1871 that destroyed the central business district of Chicago and the fires at the Columbian Exposition in 1893 caused great concern.
In 1894, William Henry Merrill established Underwriters Laboratories Inc. (UL). An electrical investigator, Merrill was hired by the Chicago Board of Fire Underwriters to investigate the fires that occurred at the Electricity Building during the Columbian Exposition of 1893. 

By contrast, in much of Europe, buildings are constructed of brick or stone, so fire is not a prime concern. Electric shock is considered the primary safety hazard and is defined as a higher safety risk than fire in European standards.

U.S. National Differences

Table I. IEC 60601 national standards (Click to enlarge).

UL 60601-1 (previously UL 2601-1) is the U.S. national standard for safety testing electrical medical devices. The standard is based on IEC 60601-1 with U.S. national differences. The U.S. national differences are the broadest and most detailed of all the national deviations to IEC 60601-1. The differences are based on a variety of reasons (see Table II), including:

• UL requirements for Recognized Components dealing with fire, shock, and safety hazards. These differences address components that do not have a harmonized IEC component standard. The deviations are identified in UL 60601-1 as DC national differences.
• National Electrical Code (NEC) requirements per NFPA 70, requirements for healthcare facilities and medical installations per NFPA 99, and other regulatory requirements. These deviations are identified in UL 60601-1 as DR national differences.
• Requirements for safety practices. These differences relate to IEC requirements that may be acceptable, but adopting the IEC requirements would require considerable retesting or redesign on the part of the manufacturer. These deviations are identified in UL 60601-1 as D2 national differences.
• Requirements for basic safety principles and requirements, the elimination of which would compromise safety for U.S. consumers and users of products. A deviation based on this criterion is identified in UL 60601-1 as a D1 national difference.
• National differences that are based on editorial comments or corrections. These deviations are identified in UL 60601-1 as DE national differences.

Table II.UL 60601-1 differences and definitions (Click to enlarge).

Flammability of Polymeric Enclosures and Covers. UL was formed on the basis of fire safety. The international base standard, IEC 60601-1, does not call out requirements for flammability for polymeric materials. However, the U.S. national deviation in UL 60601-1 refers to the “Standard for Polymeric Materials—Use in Electrical Equipment Evaluations,” UL 746C. UL 746C describes many issues pertaining to polymeric materials.

UL established a flame rating classification for polymeric materials (see Table III). The U.S. national differences in UL 60601-1 require a minimum flame rating of UL 94V-2 for transportable equipment and UL 94V-0 for fixed or stationary equipment. If the fire enclosure is sourced by circuits limited to less than 15 W, flammability requirements are not required. The definitions of transportable, fixed, and stationary are detailed in IEC 60601-1 in Definition Clause 2.

Enclosure Mechanical Abuse Tests. Enclosure mechanical abuse tests are performed to ensure that the enclosure does not expose any live parts or cause a fire, electric shock, or mechanical hazard from these tests. The ball-impact test is an addition to the requirements in IEC 60601-1, and the drop test is a modification of the test requirements called for in IEC 60601-1. The ball-impact test is conducted on the top, sides, and front surfaces of the device under test with an impact of 6.78 N-m or 5 ft-lb.

The drop test is conducted on handheld or hand-guided (i.e., electrode) devices, and each of three samples is to be dropped three times from a height of 1.22 m (4 ft) onto a tile-covered concrete surface. The IEC 60601-1 drop test is from 1 m, and only one sample is dropped three times. Additional mechanical tests deal with end stops.

Table III. UL 746C flammability ratings (Click to enlarge).

Leakage Current. The U.S. leakage current deviation is based on the values and requirements of NFPA 99, “Health Care Facilities” and the ANSI/AAMI “Safe Current Limits for Electromedical Apparatus” standards. The differences from IEC 60601-1 modify the acceptable passing limits for the earth and enclosure leakage tests, and maintain the same values for the patient leakage tests.

The base IEC 60601-1 standard does not directly differentiate between inside and outside the patient environment. IEC 60601-1-1, “Medical Electrical Systems,” which addresses a combination of several pieces of equipment, does make a distinction between inside the patient environment and outside it with respect to leakage current testing. UL 60601-1 differentiates between patient-care equipment (6 ft around and 7.5 ft above the patient) and non-patient-care equipment for these leakage current tests. In UL 60601-1, the leakage current values are specified in Tables 19.5DV.1 and 19.5DV.2. These values are given as:

• Class I product (typical value) = 300 µA patient-care area
• Class I product (typical value) = 500 µA non-patient-care area.

UL 60601-1 allows opening of the ground conductor and one of the supply connections simultaneously for non-patient-care equipment. In most cases, the following is true: The earth leakage current test per UL 60601-1 provides the worst-case conditions within the patient area, whereas the enclosure leakage current test per IEC 60601-1 is the worst-case test in the normal condition. 

Components. Deviations for UL component standards are defined as DC differences. The modification to the standard shows up in subclauses 3.10DV.1 and 3.10DV.2. These two subclauses call out printed wiring boards, lithium batteries, optical isolators, wiring and tubing, CRTs that are greater than 5 in., and any component in the primary up to the safety isolation transformer.
These components need to meet nationally recognized standards (such as ANSI/UL standards) or internationally harmonized component standards. Annex DVA tabulates UL component standards covering components as specified in subclauses 3.10DV.1 and 3.10DV.2 (see Table IV).

Protective Earthing (Ground Impedance). The U.S. National Electrical Code (NEC) requires that x-ray equipment enclosures and associated equipment have a grounded enclosure around parts that are operating at over 600 V ac, 850 V dc, or 850 V peak. The details are described in added subclauses 18m and 18n.

Conductive Coatings. Conductive coatings are used for electromagnetic compatibility (EMC) shielding to reduce EMC emissions of a product that is made of nonmetallic material (typically plastics). This form of shielding is not as effective as a grounded metal enclosure but can be helpful for a nonmetallic enclosure. Subclause 55DV.2 specifies that conductive coatings applied to nonmetallic surfaces (i.e., plastics) must comply with the applicable requirements in UL 746C, “Standard for Polymeric Materials—Use in Electrical Equipment Evaluations.” These tests are to confirm that the conductive coatings do not flake or peel, reducing spacings or bridging live parts, which could then cause a safety hazard.

Power Supply Cords and Plugs. The U.S. standard requires use of “hospital-grade” or “hospital-only” plugs if a mains hospital-grade plug exists “for the particular electrical rating in question.” In addition, the standard requires mains plugs of nonpermanent equipment with a ground to meet the requirements of UL 498, “Attachment Plugs and Receptacles.”

Any cord-connected equipment that has “hospital-grade” or “hospital-only” attachment plugs “shall be provided with instructions to indicate that grounding reliability can be achieved only when the equipment is connected to an equivalent receptacle marked hospital only or hospital grade. These instructions need to be marked either on the equipment or on a tag on the power cord. 

These differences, which are based on the U.S. NEC, are detailed in UL 60601-1 subclauses 57.2DV.1 and 57.2DV.2.

Production-Line Tests. Production-line tests, which are typically a limited number of final tests, are conducted on 100% of the product manufactured. The IEC standard does not prescribe the specific tests and values, times, etc., required, leaving these to the manufacturer's discretion per Appendix A, Rationale, subclause 4.1. To address this, Annex DVB of UL 60601-1 specifies the details for the dielectric voltage withstand, ground continuity, and single suspension system tests. 

It is important for manufacturers to read subclause 4.1 closely and talk with their certification agencies to determine appropriate minimums for production-line tests. UL does not require earth and patient leakage current tests, but the Canadian Standards Association (CSA) and most European certification agencies do. Medical device manufacturers should consider conducting this production-line test, even if the device will be sold only in the United States, to ensure that the leakage currents the patient is exposed to are below the requirements of the standard. This issue should be covered in the device manufacturer's risk management of the product.

Canadian National Deviations

Table IV. UL component standards applicable for UL 60601-1 (Click to enlarge).

Similar to UL 60601-1 in the United States, CAN/CSA C22.2 No. 601.1 in Canada contains national deviations, which are partially based on the Canadian Electrical Code (CEC). The Canadian standard helps clarify some issues by adding editorial notes helpful to understanding some requirements of IEC 60601-1.

Rub Test Definition. The rub test is conducted on any markings on the unit that are required by the IEC 60601-1 standard. The test is conducted with water, isopropyl alcohol, and methylated spirits. The Canadian standard defines the composition of methylated spirits. It defines methylated spirits as a combination of 90.0% ethanol, 9.5% methanol, and 0.5% pyridine. The definition appears in Appendix A2, subclause 6.1(z).

Ground Impedance Test. The ground impedance test is typically conducted at 30 A for 2 minutes with a maximum no-load voltage of 4 V (based on the Canadian deviation) for medical devices rated up to 15 A. The Canadian standard calls out C22.2 No. 0.4 “Bonding and Grounding of Electrical Equipment (Protective Earthing).” The maximum resistance allowed is 0.1 ? for products that have detachable power supply cords and for permanently wired products.

For a product with a nondetachable power supply cord, the maximum allowed resistance is 0.2 ?. In the IEC standard, the test is conducted at 25 A for units rated up to 16.66 A for 5–10 seconds and a maximum 6 V no-load voltage.

Language Requirements. Clause 6 of the Canadian standard requires that safety instructions on equipment and in accompanying documents be written in both French and English. If the manufacturer is not exporting to a French-speaking province, it is possible that company would not need to provide French translations. However, device manufacturers should verify the spoken language with their certification test house before setting up the labeling and accompanying documentation.

Power Supply Cords and Plugs. Canadian requirements for hospital-grade power cords are similar to those in the United States. The power plug requirements are called out in CSA C22.2 No. 21 and No. 42. These requirements are detailed in subclauses 57.3(b) and 57.2(g) of CAN/CSA C22.2 No. 601.1, respectively.

Gas Connectors and Medical Gas Cylinders. The Canadian deviations are written to avoid any confusion with connection to or use of the proper medical gas. The Canadian standard requires that “the point of connection of gas cylinders to the product is: (i) gas specific, (ii) noninterchangeable, and (iii) identified.” CAN/CSA C22.2 No. 601.1 requires the medical gas inlet connectors on equipment be: (i) gas specific, (ii) noninterchangeable, (iii) of a specific diameter per Compressed Gas Association Pamphlet V-5, and (iv) comply with CAN/CSA Z305.2.

Pressure Vessels. At the publication of the standard, Canadian requirements stated there was no national 
regulation dealing with pressure vessels. Each province has different pressure-vessel requirements based partially or wholly on the CSA standard B51, “Boiler, Pressure Vessel, and Pressure Piping Code.”

Japanese National Deviations

Table V. Leakage current definition per JIS T0601-1 (Click to enlarge).

The Japanese national deviations to IEC 60601-1 are contained in the JIS T 0601-1 standard. These deviations can be categorized into seven main areas in which the JIS T 0601-1 standard differs from IEC 60601-1.

Reference Standards. For reference standards, JIS T 0601-1 refers to the JIS standards instead of the IEC standards. Some of the JIS standards cited are not compatible with, or do not have, an equivalent IEC standard (e.g., JIS C 0446, “Identification of Conductors by Colors or Numerals”).

Power Cords. JIS T 0601-1 permits alternative colors (white/black) to the international (blue/brown) colors of the conductors for power cords conforming to JIS C 3301. JIS T 0601-1 also restricts the use of vinyl cord (per JIS C 3306) if a metal enclosure is exposed to 60C or higher. JIS T 0601-1 also restricts Class-2 vinyl cord exposed to 75C or higher.

Leakage Currents. The Japanese national standard, JIS T 0601-1, labels leakage currents throughout the document as shown in Table V.
Additionally, one of the main differences between JIS T 0601-1 and IEC 60601-1 is that JIS T 0601-1 does not require an enclosure leakage current measurement to be taken with mains voltage applied on signal input or output parts (SIP/SOP). This is the test in IEC 60601-1 that assumes that the accessory connected to the medical device will fail at mains power.

In IEC 60601-1, this requirement is exempted only if the manufacturer has specified accessories compliant with IEC standards (e.g., IEC 60950 for information technology products) or includes a warning in the manual that users must ensure that devices connected to the device ports (SIP/SOP) comply with IEC standards. The JIS T 0601-1 standard has a more realistic approach.

Also, IEC 60601-1 puts a limit on leakage current, regardless of the waveform and frequency. Leakage current should not exceed 10 mA for frequencies above 1 KHz. JIS T 0601-1 has the same limit, but clarifies that this measurement is to be done directly through a 1-k? noninductive resistor.

Dielectric Tests. JIS T 0601-1 permits the use of 50 or 60 Hz for the dielectric test voltage to check insulation that in normal use is subject to nonsinusoidal voltages.

Collateral Standards. JIS T 0601-1 removes EMC (IEC 60601-1-2) as part of the JIS T 0601 standard. The EMC standard is part of the requirement of the IEC 60601-1 standard (under Clause 36). However, this does not mean that electromedical devices sold in Japan are exempt from EMC requirements. Rather, EMC requirements are addressed separately as part of product approval (Shonin) by the Ministry of Health, Labor, and Welfare. Under JIS T 0601-1, complying with IEC 60601-1-4, the collateral standard for devices that incorporate programmable electronic systems (i.e., software), is optional.

Other Deviations. JIS T 0601-1 effectively reduces the temperature limit of pins on appliance inlets for hot conditions to 120C (from 155C), reserving the higher limit for special conditions. 

Australian National Deviations

The Australian national deviations to IEC 60601-1 are contained in Australian Standard AS 3200.1.0. This standard is identical to IEC 60601-1 except that the Australian national deviations are listed in a separate appendix (Appendix ZZ).

Compliance to AS 3200.1.0 is not required under the new Australian Therapeutics Goods (Medical Devices) Legislation (2002). It is possible to register products with the Therapeutics Goods Authority (TGA) using IEC 60601-1 and evaluating medical devices at 240 V, 50 Hz. There are four main areas in which the Australian standard deviates from IEC 60601-1.

Reference Standards. AS 3200.1.0 refers to AS standards rather than IEC standards. For example, AS 3200.1.0 calls out AS 1939 instead of IEC 60529 for degrees of protection provided by an enclosure.

Gas Connection and Gas Cylinders. Similar to Canada, Australia is concerned about confusion associated with the connection of gas cylinders for medical applications. AS 3200.1.0 requires that gas cylinders be marked in accordance with AS 1994, and gas connections (>50 kPa pressure) must comply with AS 2472, AS 2473 or AS 2896, as appropriate.

Suspended Masses. Additional protection for ceiling-supported equipment is required in the AS 3200.1.0 standard. Such equipment includes anticrash devices and brakes or stops that even in single-fault condition do not constitute a hazardous condition. Also required by the AS 3200.1.0 standard is additional protection for floor- and floor-to-ceiling–supported equipment. Such devices include means to inspect cables and anchorages, locknuts, or grub screws for cross arms, pivots, etc.

Power Supply Plugs. Like other nations, Australia requires a provision for inspection of flexible cords fitted with a plug that can be rewired. Plugs are required to be clear-backed to facilitate inspection of the colors and the condition of the termination.


When applying IEC 60601-1, be sure to review all the national deviations. The information included in this article covers just some of the issues that may apply. 

Device manufacturers should define their new products' target market before deciding on a test program. Once the target market is established, then the proper national deviations that apply (in addition to IEC 60601-1 tests) can be defined, and test plan that encompasses all the national deviations can be determined.

It is possible that two versions of the same test may be required by different national standards. The worst-case test may be used to represent both, but there are times that both tests are necessary to meet the regulatory requirements of both countries. 

Copyright ©2004 Medical Device & Diagnostic Industry

Heart-Wave Findings Might Lead to Better Defibrillation

Originally Published MDDI February 2004


Erik Swain

Figure 1. Detailed analysis of damped wave (DW) propagation. (a) 3-D presentation of signal upstroke. The arrows indicate the DW with decaying propagation (black) and the growing wave (white). (b) Signal upstroke as a function of time and space along the a axis. (c) The amplitude of filled and open waves from the 3-D plot in (b) (click to enlarge).

Scientists at Vanderbilt University (Nashville, TN) have made some discoveries about electrochemical waves in the heart that could lead to improved defibrillator designs or better ways to use such devices.

Fibrillation happens when contractions in the heart are caused by uncoordinated electrochemical waves. These waves stop the heart from pumping blood, which in turn causes death. The condition is stopped with a defibrillator, either an implanted one or a model with paddles. Defibrillation shocks stop the heart's waves and prevent new ones from occurring. 

Caregivers prefer to use as low voltage a shock as possible in order to minimize tissue damage and preserve the batteries of implantable devices. “However, if the voltage is too low, fibrillation returns immediately and you have to try again,” explains John Wikswo, one of the Vanderbilt researchers involved in the project. “The puzzle is why.”

The team is investigating the role of a little-studied slow electrochemical wave known as a damped wave (DW). “Damped propagating waves are generally not well understood, largely because they are difficult to view and study,” says Wikswo, who is director of the Vanderbilt Institute for Integrative Biosystems Research and Education. “It turns out that cardiac tissue provides a beautiful example of these waves.” 

The study, which for now is being done on rabbit hearts, is examining whether the damped waves are not fully extinguished by a low-voltage shock, or if new waves are created by the shock. Because damped waves are difficult to detect, they might be propagating slowly in the heart wall rather than dying out, unbeknownst to caregivers. In turn, that might cause a return to fibrillation or an onset of cardiac arrhythmia. 

The team has created a damped wave with a weak stimulus and sent it in the wake of a smooth-moving wave with a strong stimulus. Figure 1 provides a detailed analysis of damped wave propagation. “If you timed it just right, you could find that the second [damped] wave would hesitate and then split in two,” says Wikswo. “One half would get smaller and slowly die, while the other half would sharply increase and eventually become a self-containing wave on its own [and cause a defibrillation failure]. What surprised us is the ease with which we could create damped waves that hung around for 50 milliseconds, which is a long time when you are defibrillating the heart.” Findings were published in the November 14, 2003, issue of Physical Review Letters.

Future research will aim at determining whether the waves created in this experiment can also occur spontaneously after defibrillation. If so, that might lead to studies that show how to better manage these waves and how to improve the efficiency of cardiac defibrillators.

Wikswo's collaborators at Vanderbilt include Veniamin Sidorov, Rubin Aliev, Marcella Woods, Franz Baudenbacher, and Petra Baudenbacher.

Copyright ©2004 Medical Device & Diagnostic Industry

Nanotube-Sorting Method Could Pave the Way for Medical Applications

Originally Published MDDI February 2004


Erik Swain

Sorting nanotubes may help scientists use them in medical device applications.

A group of scientists has found a way to sort carbon nanotubes through the use of DNA. Such tubes form the basis of building blocks for medical diagnostic devices and other electronic applications that are more than 100 times smaller than what is found in today's microchips.

The group, led by researchers from DuPont's (Wilmington, DE) Central Research & Development department, found that the ability to sort and assemble carbon nanotubes allows for uniform conductivity, which will make them more useful in practical applications. Normally when nanotubes are fabricated, ones of different electronic types randomly clump together, compromising conductivity.

The researchers first found that single-stranded DNA can react with carbon nanotubes to form stable hybrids that disperse the nanotubes in an aqueous solution. Then, working with scientists from the Massachusetts Institute of Technology (Cambridge, MA) and the University of Illinois (Urbana, IL), they were able to separate the nanotubes using single-stranded DNA and anion-exchange chromatography. 

They found that a particular sequence of the DNA assembled into a helical structure around individual carbon nanotubes. The hybrids can be sorted using anion-exchange chromatography because they have different electrostatic properties depending on the diameter and electronic properties of the nanotubes. 

What this means is that metallic carbon nanotubes can be separated from semiconducting carbon nanotubes, and the latter can be sorted by diameter. Now that the different kinds of nanotubes can be isolated, it may become easier to use them in developing medical applications. The group published its findings in the journal Science. 

The research team included DuPont's Ming Zheng, Anand Jagota, Bruce A. Diner, Robert S. McLean, G. Bibiana Onoa, Ellen D. Semke, and Dennis J. Walls; MIT's Adelina P. Santos, Grace Chou, Mildred S. Dresselhaus, and Georgii G. Samsonidze; and Illinois's Michael S. Strano, Paul Barone, and Monica Usrey.

Copyright ©2004 Medical Device & Diagnostic Industry

Unconventional Machining Options Make Their Mark

Originally Published MDDI February 2004

Cover Story

Chemical and laser processes shine in shaping thin parts.

William Leventon

Laser micromachining of a tubular medical device.

You designed it thin. Now you have to make it thin. How are you going to do it? While considering your options, don't forget about a pair of effective, but sometimes overlooked, techniques for making thin parts: chemical and laser machining. Chemical machining techniques employ acids and masks to form parts, whereas laser machining relies on laser power to cut materials to the desired shape.

Because of their speed, precision, and cost savings, chemical and laser machining techniques appeal to the thin-part manufacturer. But both techniques also have their share of limitations and downsides, which must be weighed against the advantages before deciding whether one of them fits the bill for the application.

Getting Started 

The chemical machining process starts with a flat piece of material that has been cleaned and covered with a photosensitive coating. To etch the desired part shape, manufacturers use a masking device called a phototool, which is made by photographing the part image on film. Once created, this phototool is contact printed onto the material coating. In many cases, phototools are used in pairs, one on each side of the material. The phototool includes both opaque and transparent areas. Opaque areas cover material that will be etched away, while transparent areas cover material that will be protected from etching.

When the phototools are in place, the assembly is exposed to light, which reaches only the coating under the transparent areas of the phototools. Exposure prepares these areas of the coating for hardening with a developing solution.

After developing, an acidic etchant is applied to the assembly by spraying or immersion. The etchant dissolves material not protected by the hardened coating, leaving the desired part shape.

Chemical etching turns out burr-free parts without the troublesome heat-affected zones that can be produced by laser cutting. In addition, it won't change material properties, notes Mike Lynch, vice president of operations for United Western Enterprises Inc. (Camarillo, CA). This gives the process an edge over conventional machining techniques such as stamping, which might change magnetic and other properties in certain materials, adds Lynch, whose company etches parts for catheters, pacemakers, and hearing devices.

The medical segment of the company's business has been growing, according to Lynch, who attributes this growth to the advantages of chemical etching. One advantage is that the tooling for a chemical process costs much less than conventional tooling. At United Western, he says, tooling for a typical job costs $250 to $300, while a stamping tool and die might carry a hefty $50,000 price tag.

Made from computer-aided design files, chemical etching tools can be produced within 24 hours, notes Art Long, general manager at Conard Corp., a chemical machining firm based in Glastonbury, CT. As a result, Long says, Conard can deliver finished products in two to three days, much sooner than parts made with conventional tooling.

Design Attractions 

Chemical tooling can be especially attractive to product designers. Besides its low cost, a single photographic tool can produce several versions of a medical component, according to Rick Hoppe, engineering manager at Vacco Industries Inc. (South El Monte, CA), which etches a variety of metal and plastic components. Therefore, during a customer's prototyping process, Vacco can make a number of different design variations at the same time. For this reason, Hoppe says, some companies will turn to chemical etching for prototypes even if they plan to use a conventional die to manufacture the product.

In some cases, however, there may be no practical alternative to chemical manufacturing. “Because of the design and geometry of some parts, it would be a nightmare to try to make them any other way,” says Lynch. As an example, he offers a part with a series of very small holes. Using chemical etching, he notes, “you're not trying to get a tool into these small areas. You're dissolving the material you don't want.”

On the downside, chemical etching can limit design flexibility. Because of the physics of the process, for example, hole diameters must equal the material thickness, Hoppe notes.

In addition, chemical machining is less suitable for thicker parts than thinner ones. Consider the crucial matter of tolerances. Generally speaking, the process can hold a tolerance that's 10% of the part thickness, according to Long. This means that tolerances must increase as parts get thicker. As a result, the process isn't able to meet tolerance requirements for many thicker parts.

As parts get thicker, chemical etching becomes less attractive in other ways. For example, the radius of a part loses its sharpness, Lynch notes. The process also gets longer and more expensive. Because of this limitation, Vacco, Conard, and United Western all suggest material thickness limits for etching between 0.060 and 0.090 in. Medical OEMs producing devices with thicker parts should probably explore other machining alternatives.

Customer Demands 

Medical customers are particular about their finished parts. Lynch says United Western's medical customers are quite demanding. “Their sampling tends to be very stringent,” he reports. “They want to see that every part they pick out is 100% good.”

To meet such demands for quality, United Western has beefed up its in-process inspection procedure. The company has added an inspection step after the developing stage of the process. “If that step isn't done correctly, the parts may not etch the way you expect, which will cause issues farther down the line,” Lynch explains.

At Conard, Long and his colleagues continually regenerate etchant chemistry to maintain a consistent, specific gravity and acid level. Regenerating improves process consistency and allows Conard to hold tight tolerances for longer periods of time, Long says.

Vacco also pays special attention to the composition of its etchants. For instance, the company relies on statistical process control (SPC) of the chemistry of its ferric chloride etchant. Thanks to SPC, Vacco reports greater etchant longevity and a more-consistent etch rate. “SPC has been a great benefit to the bottom line and to the quality of our products,” Hoppe says.

Another plus for the process is the latest chemical machining equipment. According to Long, etching firms and their customers are benefiting from precise new machines. Unlike older systems, which had just one pressure gauge for dozens of spray tubes, the new machines include a separate gauge for each tube, making it easier to adjust the process. The machines also let users run their chemistry hotter, resulting in faster etch rates that reduce deviation over the entire process.

Looking ahead, Lynch anticipates the development of new light sources for the chemical etching process. Today, the typical light source emits rays that travel straight down to parts directly beneath it. But the light travels at an angle to reach parts on the outer edges of a sheet. According to Lynch, this can cause slight variations in the dimensions of different parts that come from a single sheet.

In the future, though, new light sources may emit rays that travel straight to all the parts on a sheet, eliminating dimensional variation from part to part. “That's what we're all trying to get,” he says.

Making a Mark 

Components such as stainless-steel axial springs can be produced using chemical machining.

Like chemical machining techniques, lasers are making a mark in thin-part manufacturing. Laser machining represents a big and growing portion of the business at Norman Noble Inc. (Cleveland), which operates a large laser manufacturing facility. “In certain cases, I think companies are realizing that laser technology can outperform wire electrical discharge machining (EDM) and chemical etching,” says Chris Noble, the company's chief operating officer.

To attract medical device manufacturers, laser machining offers repeatability, consistency, and tight tolerances, Noble says. The technique also requires less setup work than with chemical processes. “In chemical etching, you have to create a mask or image any time you make a change,” he points out. “But in laser cutting, all that's needed is a simple program change.”

In addition, laser machines can cut very small radii that can't be made by wire EDM machines, according to Jeff Miller, Norman Noble's manager of laser research and development. Noble adds that EDM machines require small wires to cut even relatively small corner radii. “But the smaller the wire, the slower the feed rate,” he notes. By contrast, small corners don't slow the feed rate of a laser system, he says. 

Noble also maintains that, contrary to a common misconception, laser machining has become faster than cutting stacks of parts with wire EDM. The increased process speed is due to new linear-motion tables and high-speed controls that can keep up with the laser, he explains.

Still, laser machining has its downsides and limitations. For the most part, Noble says, laser cutting is limited to flat, slightly contoured, and tubular parts. In addition, Norman Noble focuses its laser capabilities on parts no thicker than 0.015 in., and the company does not laser cut parts thicker than 0.040 in.

A polyimide haptic for use in an intraocular lens can be etched using chemical machining methods.

What's more, laser machining doesn't always produce high-quality edges. “An edge cut with a diamond saw will be an almost polished edge,” notes Richard Press, president of LPL Systems Inc. (Mountain View, CA), which manufactures laser-cutting systems for the production of medical devices. By contrast, a laser-cut edge can look “like it's been vaporized, melted, and blown away,” Press says. Translation: laser-cut edges can be rough, uneven, and strewn with debris. So laser-cut edges might require postprocessing work such as electropolishing or multistep chemical procedures.

Such procedures aren't always required, however. In fact, Press notes, the roughness of some laser-cut edges can be measured in the tens of microinches—even before cleaning. Although this still isn't as good as mechanically ground edges (which can have surface roughnesses measuring less than 10 µin.), it's by no means bad.

Chemical tooling is useful for producing metal components such as the titanium interconnect shown here.

For better-cut quality, Norman Noble laser systems include electronic equipment that analyzes the beam profile in real time. Beam profiling allows the company to change the beam width and the number of “hot spots” to better suit the material being cut. “That lets us provide cleaner cuts through all kinds of materials,” Noble notes.

That includes platinum, a material that many of the company's competitors won't tackle, according to Miller. Not only will Norman Noble's lasers cut platinum, Miller says, but “we've raised the bar to the point where we can cut it dross free.”

Rather than buy off-the-shelf laser systems, Norman Noble purchases the laser, controller, and other components and uses these components to build its own systems. For increased accuracy, the company's systems include linear stages that move the workpiece, as well as direct-drive rotary motors for tube cutting.

Stent-Cutting Systems

In high-volume manufacturing of round products such as stents, lasers offer high throughput and fast cutting time, according to Press. LPL's systems can cut tubes in “tens of seconds,” he says, which compares favorably with EDM systems that can take three minutes to cut through a tube wall. Depending on the material to be cut, LPL can provide lasers with a variety of different wavelengths and output configurations.

A high-precision stage and YAG laser system creates a flexible platform for diverse applications.

Scheduled for introduction in the first half of this year, LPL's new stent cutter is designed to hold tolerances of 200 µin. per inch of tubing. The machine will also offer a feed rate of 3.2 in./sec—four times faster than the company's current system. Press attributes the increased speed and higher accuracy to a commercially available motion controller customized with LPL's own algorithms.

For flat-sheet work, LPL will also be introducing a flatbed version of the upgraded system. This machine will include a high-power, low-divergence laser that can maintain a laser spot size less than 0.001 in. in diameter. In addition, the machine will offer the same high accuracy as the stent cutter, along with speeds as high as 6 in./sec, Press claims.

The new systems haven't been priced yet. But sophisticated laser machining equipment can be pricey. For example, LPL's laser systems start at $195,000 and go up to more than $250,000.

Currently, ultrahigh costs are holding back a promising new breed of laser. With pulse widths measured in picoseconds and femtoseconds, these lasers apply cutting energy for such brief periods of time that they don't create troublesome heat-effect zones. This results in much cleaner machining, Press says.

Although the technology exists to produce industrial lasers with very narrow pulse widths, the expenses involved make them cost prohibitive, Press notes. “If you're building a machine that you want to sell for $250,000, you can't put a $200,000 laser into it,” he notes.
But within 5 to 15 years, he believes the lasers may be a popular method of small-dimension, high-precision micromachining. The adoption rate could be boosted by technology improvements that drive down the cost of the systems, as well as demanding new applications. “It's a matter of when the technology is needed to do things that can't be done with existing laser sources,” he says.


Chemical and laser machining processes can be attractive alternatives to conventional machining operations such as EDM. The advantages of chemical machining include low-cost tooling, better prototyping, and burr-free surfaces. Chemical machining can be used to shape stainless steel, titanium, nitinol, and other metals into a variety of components, including mesh, stents, springs, and lead frames. But the process becomes problematic as part materials get thicker.

Laser machining systems cut flat and tubular materials into many different medical parts. The systems offer fast, precise, and repeatable cutting. But they can leave rough edges that need postprocessing work. Laser systems can also be expensive compared with other machining options. Despite the limitations, though, both laser and chemical machining options are worth a look for OEMs who have been less than satisfied with their thin-part manufacturing process. 

William Leventon is a New Jersey– based freelance writer who frequently covers the medical device and diagnostic industry.

Copyright ©2004 Medical Device & Diagnostic Industry

Monitoring Technology Could Detect Dementia

Originally Published MDDI February 2004


Erik Swain

Sensors embedded in a walker help
monitor the activity of its user.

An Oregon Health & Science University (OHSU; Portland, OR) professor has received a grant to create a sensing technology that can detect dementia and cognitive impairment in elderly adults.

Dementia occurs in 10–16% of those over 75 and up to 50% of those over 85. Those who experience mild cognitive impairment such as memory loss are at as much as a 50% risk of developing dementia within five years. Without family, friends, or caregivers picking up these cognitive changes, dementia can go undetected, leading to the risk of a senior falling, getting lost, or experiencing some other catastrophe.

As a result, Misha Pavel, PhD, a professor at OSHU's OGI School of Science & Engineering, is leading a three-year study to create simple, intelligent biosensors to monitor the movements of seniors continuously and unobtrusively. 

The team recently received a $300,000 grant for the project from Intel Corp. (Santa Clara, CA). The sites for the study are Elite Care, a private senior home in Milwaukie, OR, and Calaroga Terrace Retirement Community in Portland.

The sensors are being placed in areas around the facilities where seniors are often found, and, for those in the Elite Care group, on infrared badges the seniors are wearing. 

“The sensors will constantly and quietly relay information to a computer that can help us reliably determine the regular movement of each senior within the project,” says Pavel. “For example, if a senior who never takes a walk suddenly leaves the building, the sensor may be invaluable in alerting caregivers to a subtle but important cognitive change, as well as avert a potential danger in the senior getting lost or harmed.”

Another part of the project is the development of computer games for Calaroga residents to monitor trends in cognitive function over time, to define a set of cognitive capabilities for each senior, and to maintain or even enhance such capabilities. Assisting in that effort is Spry Learning (Portland). 

Right now, the sensors are being tested in a Hillsboro, OR, lab that is designed to look like a senior's living area. Motion detectors track seniors' movements and sensors on chairs and beds monitor sitting and sleeping positions.

Eventually, Pavel's team would like to get funding to enable it to test the system on seniors still living in single-family homes. 

“These kinds of embedded technologies that can be easily incorporated into everyday life are going to start becoming very important to baby boomers who want the best quality of life possible as they age,” says Pavel. “Family members will also appreciate the home-healthcare technologies that are on the horizon for added peace of mind about their loved ones' health and well-being. And caregivers will appreciate the enhanced services they will be able to offer. Technologies for home healthcare are going to be a win-win situation for everyone.”

Pavel's colleagues on the project include Jeffrey Kaye, PhD, professor of neurology at the OHSU School of Medicine and director of the Layton Aging and Alzheimer's Disease Center at OHSU and the Portland VA Medical Center; Holly Jimison, PhD, assistant professor of medical informatics and clinical epidemiology at the OHSU School of Medicine; and Linda Boise, PhD, MPh, director of education at the Layton center. Also on the project is Katherine Wild, PhD, an assistant professor of neurology at the OHSU School of Medicine. She will lead the cognitive testing and evaluate the effects of dementia.

Copyright ©2004 Medical Device & Diagnostic Industry

Medtech Forecast: The Experts Weigh In

Originally Published MDDI February 2004

Corporate Outlook

From drug-eluting stents to high-performing stocks, the medical device industry is in for a heart-pumping year.

Erik Swain and Sherrie Conroy

New Developments Stimulate Market

Analysts predict a strong year for medical devices, with exciting new developments to stimulate funding, growth, and revenues. Of particular note are products that cross over into areas traditionally dominated by pharmaceuticals.

“We are thinking a lot about solving medical problems that have been thought of as drug problems with devices,” Trevor Moody, a partner with Frazier Health Care Ventures said in a recent issue of Venture Capital Journal (VCJ). “We've made some investments related to that. The theme has been to look at the areas that drugs go after and look at the areas that haven't been served by drugs and solve those problems with devices,” he said.

Venture capitalists say they expect emerging medical technologies to drive more investment in the overall medical device market this year, according to VCJ. In addition to drug-eluting stents, other technologies should also attract venture capital this year. Such devices include implantables that act as sensors or release drugs. “We're going to see more real-time feedback loop activity,” Harry Rein, a general partner with Foundation Medical Partners, told VCJ. 

For smaller companies, the prospects for growth in neurostimulation markets are expected to continue because they are underpenetrated and large, Jan Wald, a vice president of A.G. Edwards & Sons, said in an interview with the Wall Street Transcript. “In the orthopedic space, the demographics just work out beautifully for these companies. We've seen high double-digit growth rates there as well,” he said. 

David Turkaly, a senior medical technology analyst with WR Hambrecht & Co. says that both large- and small-cap medical technology companies have outperformed the S&P 500 for the past three years. “This sector continues to be a very attractive area for investment.” He notes that consolidation in the medical sector is common even at lofty valuations, and its fundamentals are very strong. Leading companies have consistently posted high margins and high returns on equity.

Analysts agree that certain markets are going to be active in 2004, with a few key technologies dominating the medical
device marketplace (click to enlarge).

“We expect these trends to continue and believe that selective stocks will continue to outperform the broad market over the next few years,” he says.

Strong Growth Predicted

Wall Street analysts generally believe that current valuations of companies in the medical device and supply industry reflect continued strong top-line performance. According to the Centers for Medicaid and Medicare Services (CMS), the strength of the $75 billion medical device industry is based on sound underlying financial fundamentals.

During 2003, the introduction of new technologies, such as drug-eluting stents and cardiac rhythm management devices, drove revenue growth. Similar growth is anticipated through the introduction of new products within the spinal and heart valve repair sectors. In its Health Care Industry Update, CMS notes that investors are most attracted to companies developing new technologies. Investor interest provides incentive for companies to produce innovative products or to seek them through acquisition. CMS says that merger and acquisition activity slowed in recent years as device companies focused on internal operations. However, analysts expect manufacturers may become increasingly acquisitive as they seek to fill thin product pipelines.

The gross margins of both hospital supply and medical device manufactures have remained consistent (see Figure 1), according to CMS. R&D spending for most medical device companies averaged 9–10% of revenues and remains in line with historical trends. According to CMS, median net income margins for device manufacturers improved substantially from 2001 through the third quarter of 2003.

Small medical device companies continue to experience limited access to capital. Venture capital investors have become more conservative. CMS notes, however, that venture capitalists are seeing preliminary signs of increased flow of investor funds.

Drug-Eluting Products Lead Market Future

Figure 1. Medical device industry median revenue growth rate quarterly trends, 2001 to third quarter 2003. Both medical device and supply companies have experienced consistent revenue growth. Medical supply companies include Abbott Laboratories, Baxter International, Becton Dickinson, C.R. Bard, and Johnson & Johnson. Medical device companies include Biomet, Boston Scientific, Edwards Lifesciences, Guidant, Medtronic,
St. Jude Medical, Stryker, and Zimmer (click to enlarge).

The drug-eluting stent is the first medical device that is seen to have the revenue potential equal to a blockbuster drug. So it's not surprising that the technology is dominating the talk of financial analysts covering the medical device industry. In particular, the financial community seems to be awaiting with great anticipation the introduction of Boston Scientific Corp.'s (Natick, MA) Taxus drug-eluting stent, for which FDA approval could come as early as the first quarter of 2004.

The intense interest in the financial implications of drug-eluting stents was obvious at the Piper Jaffray Health Care Conference, held January 27 in New York City. Two of the best-attended presentations were from Boston Scientific and Johnson & Johnson (New Brunswick, NJ), whose Cypher product last year became the first FDA-approved drug-eluting stent.

“Boston Scientific is an extremely interesting story. They are on the threshold of something I have not seen in medical devices,” said Thomas J. Gunderson, a senior research analyst at Piper Jaffray (Minneapolis). “This is a company that has an established (sales) base of $3 billion but is still able to grow substantially from homegrown products,” helped in part by sales of Taxus in other parts of the world.

Other recent reports are equally enthusiastic about the outlook for drug-eluting stents and other combination products and the companies that make them. Front Line Strategic Consulting, Inc. (San Mateo, CA) projects that the worldwide drug-eluting stent market will triple from $2.1 billion in 2003 to $6.3 billion in 2008 because of an expanding patient population and applications for the technology that extend beyond coronary artery disease. Front Line's report projects the United States will account for 70% of the market because of favorable reimbursement rates. It expects J&J, Boston Scientific, and two firms with drug-eluting stents in development, Medtronic Inc. (Minneapolis) and Guidant Corp. (Minneapolis), to reap the benefits.

“We are very excited about this medical device segment,” said Rochelle Ellis, an analyst at Front Line's strategic market reports division. “For some patients, such as those with blockages in multiple vessels, drug-eluting stents offer a highly attractive alternative to bypass surgery.”

Likewise, Front Line projects the worldwide combination products market to jump from nearly $6 billion in 2004 to almost $10 billion in 2009, with drug-eluting stents accounting for 70% of the total. The firm believes the combination products industry will be helped by streamlined approval processes in the future. 

Larry Best, Boston Scientific's chief financial officer, told the Piper Jaffray audience that Taxus represents “the biggest opportunity in medical device history. There has never been a $5-7 billion opportunity for one product in the device sector. We think we can be number one. We have a better balloon, a better stent, a better polymer, and stunning results for our drug, Paclitaxel.”

Michael Dorner, worldwide chairman of J&J's medical devices and diagnostics business, said the U.S. launch of Cypher played a major role in boosting 2003 sales of the device business 18.5% over the previous year, to $14.9 billion. He said J&J fully expects competition with Boston Scientific and eventually others to be fierce, but it intends to “maximize our commercial opportunity.”

With all the anticipation, however, comes high expectations. While J&J reaped $470 million in U.S. sales of Cypher for the fourth quarter of 2003, some analysts were disappointed because they had projected sales closer to $600 million. A January 21, 2004 article by Dow Jones News Service quoted several analysts voicing concerns about Cypher's cost and deliverability, and the negative publicity it received over a few cases of thrombosis. Some pondered whether these issues might cause doctors to switch from Cypher to Taxus when it becomes available. If the device industry is not used to this kind of scrutiny and speculation from the financial community, it had better get familiar with it, for it comes hand-in-hand with billion-dollar sales projections.

Copyright ©2004 Medical Device & Diagnostic Industry

Medrad: Award-Winning Quality Is Its Own Reward

Originally Published MDDI February 2004

Q & A

Using the best ideas from the best companies, Medrad implements a total quality system good enough to be the 2003 Baldrige Award winner for manufacturing.

Erik Swain

John P. Friel, president and CEO of Medrad Inc., Indianola, PA.

When it comes to quality, persistence is a key virtue. Just ask the people at Medrad Inc., an Indianola, PA–maker of medical imaging products. Last November, the company was one of just seven to win the nation's highest honor for quality, the Malcolm Baldrige National Quality Award. 

The award's famously rigorous application process makes this an impressive achievement for any company. Few companies not dedicated to continuous improvement would make the effort even once. But Medrad went through it several times before winning. Why? Because you don't have to win an award in this process to make valuable gains. For companies like Medrad, the benefit of the Baldrige award is not in winning it, but in the process itself. As Medrad's example shows, it is a learning process that by itself can produce dramatic improvements in a company's operations.

The Baldridge criteria form a process and a series of best practices that companies from all industries can use to improve manufacturing and other operations. And its winners can be used as benchmarks for other companies that are looking to operate more efficiently, develop quality products more effectively, and otherwise achieve excellence. 

Since Medrad began using Baldrige criteria, the company doubled revenues between 1997 and 2002, and has expanded manufacturing capacity three times and also posted off-the-chart customer-satisfaction percentages. It made the final stages of consideration for the award three times before winning last year. John P. Friel, Medrad's president and CEO, spoke with MD&DI East Coast editor Erik Swain about how the Baldrige process works and how it benefited the company even before it won the award. 

Q: How did Medrad first get involved in the Baldrige process?

A: It started about 15 years ago. We decided to get into total quality management. This was right around the time when the first Baldrige Awards were announced. An executive team went out and visited early Baldrige recipients such as Xerox, Milliken & Co., and Federal Express. That convinced us that [the process] was appropriate for our company. I was director of sales and marketing at the time, and I personally went to Milliken. The representative there said that they had the highest margins and charge the most money in their industry, but their customers are delighted and keep coming back because of the quality. I thought that if customers are delighted that you're charging more, there must be something to this. The other senior managers had similar experiences on their visits. And that's how we got started. 

One reason we wanted to go with the Baldrige program was that by having such a framework and the same lingo, we knew we could tap into a wealth of best practices, best knowledge, and best companies and organizations that are based on the criteria. If we wanted to work on strategic planning, there was a wealth of that subject matter available. Whereas if we had developed our own model, there would not be information that would match up directly with what we were trying to do. There is a lot of value in tapping into that wealth of information. 

Q: Were there any factors specific to Medrad that prompted getting into the program?

A: We always felt that we had a high-quality organization and that we produced high-quality products. But we had an FDA inspection in 1987 or 1988 and the results were a bit less favorable than we would have liked. There were no serious difficulties but they did tell us “you're not as good as you think you are.” That was sort of a wake-up call. They were telling us areas of importance that we should pay more attention to, and that served as a springboard into the program as well.

Q: How did adopting the Baldrige program's process affect your manufacturing and other operations?

A: We've implemented numerous process improvements. The whole idea of laying out your process is central to the program. We looked at our then-current activities and used some quality tools to map out the state that we would like to be in. We called them “bowl of spaghetti” diagrams because they showed all the movement in our manufacturing and other operations. And once you've charted your process, you can see all the links going every which way. We streamlined these and came up with a much more simplified and orderly process. This included implementing things such as just-in-time inventory and demand-flow manufacturing. We stole shamelessly from benchmarked and best-in-class companies. We adopted different techniques from different companies and “Medrad-ized” them; that is, we applied them to our applications. 

Q: How did this affect your products?

A: One important change we made was what we called “inbound marketing.” That had to do with product planning and specification development and getting customer requirements from them. Significantly, we implemented numerous tools and increased our number of customer contact points. We implemented new customer surveys, focus panels, and conjoint analyses to better ensure that the specifications of the products matched up with our customers' unmet needs and requirements. The end products were better because of that upfront work. There were improvements to everything from disposable syringes to connector tubing. We made a significant investment in automation and moved away from manual processes. We are very proud that when we did that, we did not have any layoffs as a result. We were able to continue to grow the company while identifying jobs for all of those people who were affected. In many cases, they moved to higher-paying and higher-skill-level positions. Over the 15-year process, we have taken advantage of changes and improvements in 
technology that we have adapted and incorporated into our production processes. A specific example of a product that was improved is our latest CT injector, the Stellant. The improvement came about because of customer input into the specification and development processes. Some features we thought were going to be important, we found out didn't matter as much to customers. And when we used the conjoint analysis and focus groups, they indicated we should change our approach to some other features. It paid off. When we showed the device at the recent Radiological Society of North America convention, the response was phenomenal. So the adaptive role has been very rapid. Customers really like the Stellant and are responding. 

As an example on a micro level, in the disposables area we have to wind tubing on a mandrel, which is put through an oven where the coil is baked into plastic. We had an employee who had an idea for a new winding operation that would make the process more efficient. He came up with a little clip for this purpose. We took the idea and ran with it. It turned out he was right. We designed a component based on this clip and the first year it was implemented, it saved us $250,000. Now it probably saves us $500,000 a year. And that came about because under total quality management, we empower the employees and solicit ideas from them. The employees know best how to improve their jobs. Management's task is to give them the tools. 

Q: How did the program affect your relations with your suppliers?

A: Overall, it was very positive. We engaged our suppliers as partners. We increased the level of communication with them. We realized that for quality principles to work, you have to eliminate defects as early in the process as you can, and not try to inspect them out at the end of the production line, after you've added cost. Now the process is more upstream, and that includes the suppliers' operations. We are helping them with quality tools and processes. And some suppliers have employees who are located on our site. 

Our whole process of selecting suppliers was improved. We know a lot more about them and they know a lot more about us. We are doing more homework before we move forward with a relationship. We have also developed supplier scorecards that evaluate them and allow them to look for opportunities to improve.

Q: How did the award process work?

A: The process is fairly intense. First you submit a 50-page application that tells your story, based on Baldrige criteria. This serves three purposes. One is obviously to address the criteria for the award itself, but the others are that it allows the organization to do a self-assessment, and it is used to provide feedback to applicants. The judges go through the applications and decide who will go to the next stage. A lot of companies drop out at this point. 

The next review determines whether you get a site visit. This was our fourth time in the site-visit phase. During the site visit, a team of about eight examiners comes out. They spend about four days with you. We estimated that they reviewed 5000 documents and conducted 300 employee interviews in the United States and around the world. They came in for second shift and third shift. They met with everyone from product development to accounting to engineering. At the end of that, they compile a feedback report. 

Aside from the recognition, the feedback report is the real value in going through the whole process. The suggestions and opportunities for improvement based on the criteria are what we are looking for. Some, we decided, were not appropriate for us, but most were ideas that we wanted to take and see how they applied to our business. Then, if you don't receive the award, you start the process all over again the next year. 

Q: What is the key to winning the award?

A: Continuous improvement has to become part of what you do every day. It has to get ingrained into the fabric of your organization. Who you are and what you do follows from the framework. It's like breathing. It's a complex process, but it's also elegantly simple, and you can do it without even thinking. Then that gives you a standard by which you can measure results, like a report card. We have an employee in Columbia who told me that he was nervous when the Baldrige team called, but he found the process easy because all he had to do was tell them what he does. 

Q: Why do you think Medrad won it this year as opposed to other years?

A: I can't tell you for sure. It's hard to say one particular thing did it. You keep accumulating the benefits of the process, and eventually you reach a cumulative result that is worthy of recognition. But when [the selection committee] made the announcement, it cited several things. [The committee] liked our consistent growth rate, which has averaged 15% a year. We are a market leader in the United States and Europe, and our market share is significantly greater than our nearest competitor. Our on-time delivery results are 98–100%, which equals or exceeds best in class. The results of our overall employee satisfaction surveys consistently exceed the best-in-class benchmark. We get the highest possible response when our employees are asked if they understand the company objectives and how their jobs fit into them. We invest a lot in employee training and we have a good internal product development process. We get good marks for leadership and social responsibility. We have a code of conduct related to ethical behavior, and we participate in the United Way's “Day of Caring,” in which we give employees a full day to do community support projects. We have a strong employee development program and spend $500,000 a year for tuition reimbursement. 

Q: What will the award mean for the company in the short run and in the long run?

A: The recognition is nice. We are delighted about it and are very appreciative. We are glad to see our employees get the recognition that they really deserve. In the short run, it is a tremendous morale boost. When we approach the actual day that we will receive the award and meet the president, the morale boost will be tremendous. In terms of practical benefits to the company, we'll be identified as a good company to work for, and that should help us hire the best possible people that we can. We will become that much more attractive to the best and the brightest, nationally and internationally.
In the long term, we must guard against thinking that we've “made it” and can rest on our laurels. It will be a challenge to grow the business in the increasingly complex medical device imaging marketplace. We will have to continue to apply the principles we've learned and try to become a better and stronger organization every day. 

It is also a positive for the Pittsburgh region. It shows that Southwestern Pennsylvania has what it takes to build a world-class, quality medical device company. We have universities, world-class hospitals, great quality of life, and solid economic development organizations. It proves the people in Southwestern Pennsylvania are of the caliber to produce a world-class organization. 

Part of the responsibility of a Baldrige Award winner is to be a good ambassador for the award, and we intend to do that. Baldrige is a very good framework to use, and we would like to promote it. You've got to have a multifaceted focus on continuous improvement with customers and with your employees, while having social responsibility and continuing to drive innovation. Focus on those priorities, and the business results will follow. 

Copyright ©2004 Medical Device & Diagnostic Industry

An Optimistic Outlook for Medtech Stocks

Originally Published MDDI February 2004

Corporate Outlook

Erik Swain and Sherrie Conroy

Big Leap for Small-Cap Medtech Stocks

Small-cap medtech stocks showed 60% growth over the course of 2003, says Steven F. Hamill, CFA, senior 
research analyst with Piper Jaffray (Minneapolis). Large-cap medtech stocks traded fairly in line with historical premiums. The discounts for small-cap stocks clearly shrank because of their growth. Discounts were down from 35% to 25% for price-to-sales ratio. That change reflects strong movement in the small-cap group. Hamill cautions, however, that the small caps rose en masse. He questions whether some companies that were taken along for the ride—but did not perform—might pull back. He also notes that although the mergers and acquisitions window did open up somewhat, the average deal stayed relatively small at $300 million, and the premiums for takeovers were not enormous. Half of the deals were in orthopedics, including the only two that were more than $1 billion. Also of note: there were no IPOs, and secondary offerings did not change. The 2003 deals did perform better than the previous year, but they ran the gauntlet in terms of quality. 

Sorting out the Highs and the Lows

It was a good year for healthcare and medical devices, small-cap stocks in particular, says Thomas J. Gunderson, senior research analyst with Piper Jaffray. “As growth continues, we question whether P/E, earnings, and revenue growth are enough to value the bigger caps,” says Gunderson. He points out that 12 years ago, large-cap medical device stocks did not exist. “Only Medtronic could have counted as one. Now, as we have many 
larger-cap device stocks, we need more sophisticated tools [with which to evaluate them],” he says. Many factors, including goodwill, can inflate earnings growth, he says. Foreign currency added 4–6% on top of the growth.

“We are working harder to tease out the actual earnings and crunch them. One indicator is a company's cash flow rate divided by total assets. That gives us a better correlation to market value [than many of the traditional measures],” he explains.

He says the double-digit growth by this measure appears not to be sustainable over a 2–3 year period, citing Zimmer, Boston Scientific, Cytec, and STERIS as strong performers by this measure. “The highs are lower and the lows are higher. We need more-sophisticated tools that don't replace fundamental analysis or due diligence, but rather increase our sense of the sell side,” he says. “There will be winners and losers.”

Key Themes for 2004

Devices are moving into traditional drug markets such as congestive heart failure, depression, cancer, and Alzheimer's disease, says Scott R. Davidson, senior research analyst with Piper Jaffray. He also highlights the drug-device convergence, noting that devices are getting into areas that have historically only seen pharmaceutical solutions. “We are quite optimistic. It's good to see.”

One issue, he says, is what he calls cliff risk. Issues such as going off patent are becoming relevant to more and more device industry subsectors. “We saw this happen in the first round of the stent wars,” he says. “This issue can determine which stocks should be sold. It will also help predict the breakouts of successful companies.”

The device industry will also face consolidation. He says 2004 will see an above-average amount of mergers and acquisitions in the medtech space, especially as it pertains to companies on the upswing of a new-product cycle. “We will see offensive M&A, in which companies look to the next leg of growth, but also defensive M&A, to protect market leadership and existing franchises,” Davidson says. He says spinal disc deals have been 
particularly prominent, with three in the last 18 months.
Davidson says analysts are hopeful about FDA actions restricting growth. He notes that the agency is increasingly willing to work with foreign-
country clinical trial data as a larger part of a PMA. He also believes that device user fees will bring more reviewers to help get products to market faster. He is optimistic about new reimbursement rules in Japan and a new leadership at CMS in the United States.

Cardiology is the most dynamic of the big sectors, Davidson says, but cautions that 2004 will be “a bit of a gap year.” Large cardiology companies could be active acquirers. “The orthopedics sector will also continue its positive trends, and consolidation will be big.” Another major sector, neurology, has is the potential approval of the first device to treat depression, he adds.

Buyers are scarce, he says, particularly because of small-cap valuations in 2003. However, he concludes that the field is likely to stay very strong. “There will be strong plays in the traditional fields like cardio and orthopedics. People will also be encouraged to look at subgroups like hearing aids, women's health, and diagnostics,” he says. Certain companies in these areas could outperform predictions. He also forecasts selected opportunities in a small number of stocks that did not perform well in 2003.

Copyright ©2004 Medical Device & Diagnostic Industry

Intuitive Design: Removing Obstacles Also Increases Appeal

Originally Published MDDI February 2004

Design and Development

Following advice from caregivers can ensure ease of use.

Michael Wiklund

The HeartStart FR2+ semiautomatic external defibrillator directs the user's 
attention and actions with bold numbers.

Imagine that you are an experienced nurse starting a new job at a large teaching hospital. You've been assigned to a cardiac-care unit where your first patient is a 65-year-old male with acute hypertension (high blood pressure). The charge nurse asks you to set up and begin an intravenous infusion for the patient using a four-channel pump that you've never operated before.

Fortunately, the comparatively advanced device is intuitive to use. The device's large computer display explains exactly what to do at every step, from hanging the IV solution bag to inserting the IV tube into the pumping mechanism to programming a flow rate. After the pump checks that the programmed dosage is safe, it directs the user to start the infusion by pressing the big green button that dominates the front panel.

Potential delay or compromise to patient care averted! Instead of struggling to understand how to set up and run the unfamiliar pump, you could follow the instructions and draw upon your existing knowledge and skills to operate it correctly the first time. Wouldn't it be nice if all user–device interactions went this smoothly?

Regrettably, many user-device interactions do not proceed this smoothly. Rather, caregivers frequently encounter obstacles trying to use an unfamiliar device. The device may offer little guidance on its proper operational sequence, leaving the user guessing what to do next. It may require the user to look up and enter a cryptic numerical code to start a function, thereby opening the door to confusion and user error. Or the device may provide little feedback to judge whether it is working properly.

Caregivers, many of whom consider themselves “can do” individuals, overcome such obstacles by seeking guidance from experienced colleagues or by simply spending precious time figuring things out. Naturally, most caregivers prefer devices that are easy to use from the start, especially considering the large number of devices they encounter in their work.

The key for medical device developers is to fulfill their customers' need and desire for initial ease of use (i.e., intuitiveness) without compromising operational efficiency (i.e., task speed). It's a balancing act that requires developers to take a holistic view of the user experience, which may begin with in-service training or self-discovery and span a decade of daily use.

Limitations of Training

Developers often cite training, particularly in-servicing, as the cure-all for products that are difficult to learn to use. The average in-service session lasts no more than an hour and may include a dozen or more people. Some trainers may wish to provide more information one-on-one, but caregivers usually do not have sufficient time to devote to in-depth training.

Criticare Systems's 504 DX portable pulse oximeter employs large, well-spaced membrane keys.

Typically, a manufacturer's representative teaches the in-service sessions, covering the basic operational concepts and demonstrating the essential tasks. Many hospitals take a “train the trainer” approach that calls for key staff, such as nurse educators, to receive training from the manufacturer's representative, then pass the lessons along to other staff. Caregivers generally much prefer hands-on training to reading and following instructions in a user manual.

However, despite the popularity and presumed effectiveness of in-service training, many first encounters between caregivers and medical devices actually occur at the point of care, such as the patient's bedside. A caregiver may have missed the training because she or he was busy with a patient or was off duty. In some cases, caregivers “float” from another unit that does not use the particular device and, therefore, have not received training. Perhaps the caregiver comes from a temporary nurse agency that has supplied RNs to address a staffing shortage. Or, it may be a caregiver's first day on the job, as described earlier, presenting no prior opportunity for training.

Accordingly, it is wrong to assume that all staff will receive formal training before they use a particular medical product, despite the movement to require caregivers to complete training exercises before they are authorized to use a device. Restrictions on device use are simply not the norm at this time. So, the burden remains on manufacturers to design products that enable users to easily understand a device for themselves—and quickly—before a patient suffers any harm.

Intuitive Design: Caregiver's Perspective

Human factors textbooks offer extensive advice on how to design intuitive user interfaces. However, caregivers are also a good source of guidance. The following recommendations have been distilled from interviews with several nurses working in general medical and critical-care environments. Notably, many of the design characteristics that enhance intuitiveness also tend to reduce the potential for user error and increase product appeal.

Provide Extensive Prompts. Nurses want devices to lead them through a clear and consistent series of actions to accomplish a task, almost as if a human guide were leading them. They view prompting (i.e., a series of short, context-sensitive instructions) as the surest way to avoid skipping a critical step. They accept that prompting may increase the time required to complete a task, but feel that extensive prompting can speed up procedures by reducing the need to seek help. They also see prompts as a means for new users to teach themselves to use a device in a fail-safe manner.

One nurse commented that she attended an in-service session on how to use an epidural pump, but then did not see it for another few months, leaving her time to forget her training. She felt that step-by-step prompting would have been her savior if she were pressed to use the pump with little notice. She noted that nurses are prone to take any shortcuts that save time, but deep down prefer to follow methodical procedures that prevent errors.

Another nurse commented, “Why keep steps 1 – 2 – 3 and 4 a secret? Print them right on the product.” She was less concerned with making a medical device look too simplistic than with ensuring that every person operated the device correctly. So, while literally labeling a product with the numerals 1 – 2 – 3 and 4 may not always be a viable solution, the underlying intent seems valid: design the user interface to accentuate the proper operational sequence. 

One nurse insisted that a device should not only tell users when they do something wrong, but should also tell them how to correct their mistake. She welcomed the use of voice output as an intuitive means for appropriate devices, such as defibrillators, to communicate with caregivers.

Use Prominent Labels. Nurses applaud the use of prominent labels to conspicuously indicate a device's purpose and proper operation. One nurse offered the example of labeling defibrillator pads with the words Front and Back in large black letters as a good way to direct users to apply them correctly. She explained that first responders, such as members of a Code team, have little time to figure things out in a crisis. They perform tasks by rote rather than pausing to identify and analyze their options. So, they are better off when a device spells out the operational basics in an almost exaggerated manner.

Commit to a Single, Optimized Configuration. Contrary to the call for customization, nurses considered device configurability to be a problem. In their view, enabling devices used within the same institution to assume various configurations compromises a nurse's ability to master their operation. Consequently, experienced nurses may encounter new configurations that take time to decipher. Many would sacrifice flexibility for the sake of configuration stability, noting that stability enables the experienced nurse to provide expert support to new users.

Prevent Users from Turning Off Critical Alarms. Nurses recognize that they may give device manufacturers conflicting guidance regarding alarms. They despise nuisance alarms that create more work. However, they recognize the underlying benefit of alarm systems associated with critical therapeutic and monitoring devices. Therefore, they advise manufacturers to prevent users from turning off any critical alarms, presuming that users can silence alarms for an appropriate amount of time.

Provide Large Displays. Large displays have obvious benefits. They provide enough space to utilize large graphics, text, and numbers, making the information readable from a distance. Designers can also use large displays to emphasize critical procedures, which helps both new and experienced users focus on the most important information. Large displays also provide room for prompts.

One nurse lamented that manufacturers seem to design their products for people in their 20s who have better than 20/20 vision and who will view displays in ideal lighting conditions. Noting that the average age of nurses is in the mid-40s, she advised manufacturers to oversize their displays, labels, and other printed materials so they are legible to people who have reduced visual acuity. 

Provide On-Line Help. Nurses like an embedded on-line help system, as long as the manufacturer invests enough resources to make it truly helpful. One nurse described on-line help systems as a time-saver. She noted that she could direct new nurses to check the on-line help if they encounter operational problems, thereby reducing demands on her time.

Another nurse considered on-line help superior to quick-reference cards because cards become worn and outdated, whereas on-line help contains more information and can provide context-sensitive assistance. She also commented that nurses just out of school are quite comfortable with computers and expect a sophisticated device to incorporate on-line help, just as they expect contemporary software applications to include one.

Another nurse insisted that smart devices, such as those that incorporate an on-line help system, should tell new users what they need to know about operating the device in three minutes or less. She explained that nurses in her large hospital rarely have time to attend an hour-long training session. She added that so much equipment is being “rolled out” that she would be attending such sessions all the time rather than attending to her patients.

Provide Large Controls. One nurse observed, “I've yet to see a device with buttons that were too big.” This comment underscores the view held by several nurses that large controls make a device easier to use and, conversely, that small controls make a device harder to use. The association between large controls and ease of use may be part perception, but one can understand the preference for controls that provide a good visual target as well as a firm grip. 

Shape and color coding can make controls even more intuitive. Touch screen–based controls, such as those found on some patient monitors, can also make a device easier to use, presuming that the touch targets are not crowded together and provide effective actuation feedback by means of visual effects and sounds.

Be Consistent. Several nurses recommended that manufacturers standardize their controls and graphical symbols. One nurse noted that people could step into virtually any rental car and drive away because the placement and operation of the primary controls are relatively consistent. She challenged medical device manufacturers to achieve a similar degree of design consistency so that caregivers can easily switch from one medical device to another.

One nurse advised manufacturers to make all of the necessary connections obvious, half-seriously suggesting that some manufacturers now go so far as to hide connection ports from the user. She also recommended using shape and color coding to the maximum extent possible so that making the proper connections is a simple matter of matching up similar looking components.

Automate Appropriate Functions. Nurses welcome automation as long as they can remain “in the loop” in terms of understanding a patient's condition so that they are prepared to respond effectively to emergencies, including those involving a device failure. For example, nurses feel no strong need to calibrate a device or run a maintenance check if the device can be engineered to perform these functions automatically. Such automation makes devices easier to learn because there is simply less to learn.

Avoid Minor Changes. Nurses get frustrated by minor, incremental changes to medical devices that contradict the expectations they have developed using earlier-generation products. They recommend that manufacturers stick to one method of operation, rather than introduce a slightly different scheme of operation, until they are ready to launch an entirely new iteration of the device. Minor changes can actually be more confusing than wholesale changes.

Enable Users to Practice Tasks. Nurses welcome medical devices that incorporate a simulation mode and the accessories necessary to practice using them. Such devices enable users to gain proficiency with a device before using it on a patient. However, devices need protections in place to prevent users from confusing simulated performance with actual performance.

Enable Users to Perform Checks. Nurses also welcome the increased computing power found in many devices that makes it possible to check user settings, such as a programmed infusion rate. Such power enables them to ensure that the settings fall within the boundaries of normal use established by the manufacturer or healthcare institution. That way, if their inputs fall out of the normal range, the device can alert them to the potential hazard, such as a morphine overdose.

Make Important Features and Information Prominent. Nurses recognize that some controls and displays are used more frequently or urgently than others and that some controls and displays perform especially critical functions. They feel that the important controls and displays should grab the user's attention. This may be accomplished by making them larger, segregating them from others, or coding them in a conspicuous manner, such as giving them a special shape or color.

Hold the Extras. Manufacturers feel compelled by market forces to include extra features in their products because procurement processes tend to reward feature-filled products that appear to offer greater value. However, nurses view most extra features as excess baggage that gets in the way of simple operation. One nurse commented, “Our patient monitors have lots of advanced features. I have no idea what they do.”

But, is the answer to eliminate the extras altogether? Perhaps, depending on whether the extras are important to a small percentage of potential users or practically nobody. For example, one nurse cited the dose calculator built into some infusion pumps as an extra that is useful to a small percentage—perhaps 20 percent—of all users. But other extras may be useful to only a handful of people and not worth keeping. 

Another solution is to isolate the extra features by placing them behind a panel or in a software menu. However, this solution is antithetical to human factors guidelines, such as creating logical functional groupings and providing easy access to functions. Therefore, the best approach is to scrutinize every feature in terms of its true value and to purge those that increase complexity while adding little benefit.


The medical care environment rivals consumer electronic stores, such as Best Buy and Circuit City, as a technology haven. Within critical-care environments, one finds blood gas analyzers, defibrillators, electrocardiographs, electronic thermometers, infusion pumps, noninvasive blood pressure monitors, patient monitors, patient warmers, diagnostic spirometers, and many other specialized devices. For nurses and other caregivers, these devices present a lot of technology to master, so it is no wonder they gravitate toward intuitive designs.

In a perfect world, there would be enough time to learn how to use all the features built into all of the medical devices. However, in the real world, most caregivers worry about learning the basics and utilizing the special features only when necessary and, often, only as time permits. This makes intuitiveness a critical design feature and a great opportunity for innovation, even if the innovation is the removal of an extraneous feature. 

Michael Wiklund is a vice president with American Institutes for Research (Concord, MA), a human factors consulting firm. He currently chairs the Medical Section of the Industrial Designers Society of America. 

Copyright ©2004 Medical Device & Diagnostic Industry

Device Industry Praises Medicare Reform

Originally Published MDDI February 2004


Aventor's Ted Mannen says the new law should make CMS processes more open.

Erik Swain

Although not perfect, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 contains a number of positive developments for the medical device sector, according to industry experts.

The law, passed by Congress in November 2003 and signed by President Bush in December 2003 amid much controversy, contains several measures that establish or refine processes favorable to the development of innovative medical devices. These include expanded Medicare coverage for medical device clinical trials, better methods for determining payment for new laboratory tests, and more integration of disease management programs. Also included in the new law is a faster timetable for national coverage decisions and the creation of a Council for Technology and Innovation at the Center for Medicare and Medicaid Services (CMS; 

“From our perspective, we believe the legislation will allow patients to have better access to new medical technologies that can save or improve their lives,” says Art Collins, chairman and CEO of Medtronic Inc. (Minneapolis). “This is vitally important, as such a small percentage of patients indicated for a number of medical technologies actually receive those therapies. In addition, the bill simplifies and speeds adequate reimbursement for medical technologies, which helps physicians and hospitals. Finally, the legislation helps medical technology companies secure timelier, adequate reimbursement for breakthrough products the industry develops.”

One of the most significant developments for the device industry is that Medicare will now cover routine patient-care costs of breakthrough device clinical trials, known as “Category A” trials. In the first few years of implementation, only treatments for immediate life-threatening conditions will be covered, but Benjamin Wallfisch, policy director for the Medical Device Manufacturers Association (MDMA; Washington, DC), notes that “most Category A treatments meet that definition anyway.” After January 1, 2010, the routine costs of all Category A trials will be covered. “Category B” trials for incremental advances already have their routine costs covered. Trials for new uses of devices already proven safe and effective, called “Category B4” trials, remain uncovered, but industry will lobby to change that.

The bill provides for a more-defined process for covering laboratory tests. “CMS will put up a list of suggested approaches and get comments,” says Ted Mannen, managing director for Aventor (Washington, DC). “It's designed to make the process of determining how much to pay for new tests more predictable and more open.”

Another significant provision sets more-reasonable thresholds for temporary add-on payments for new technologies used in inpatient settings. That will allow more firms some reimbursement before a coverage decision has been made, and enable them to better prepare their requests for coverage. 

“If you look at the technologies that qualify for this, it reduces the cost threshold by tens of thousands of dollars for some of the higher-end DRGs [diagnosis-related groups],” says Steve Ubl, executive vice president, federal government relations, for AdvaMed (Washington, DC). “It will enable everyone to look at rethinking therapies.”

The bill aims to enable more integration of disease management programs and greater use of monitoring technologies. “This could spur adoption of less-invasive technologies that lead to fewer complications and shorter hospital stays,” says Wallfisch. “The device industry is definitely supportive of this.”

Jo Ellen Slurzberg, vice president of consulting and reimbursement for Boston Healthcare Associates (Boston), notes, however, that disease management has not worked as well as expected in the private sector. “Private payers have often found that it's a big myth” that amounts to nothing more than cost shifting, she says. “In theory it's wonderful, but I haven't seen it work in the private sector.” The Health Insurance Portability and Accountability Act of 1996 could complicate matters too, she adds. 

Those concerns could be avoided if CMS and industry keep in mind that such a program “shouldn't be an excuse just to cut costs,” Mannen says. “I imagine industry will be involved in helping CMS focus on quality.”

The Council for Technology and Innovation will serve as a single point of contact for device companies, patients, and healthcare professionals on matters of coverage, coding, and payment decisions. “This establishes the device industry as a stakeholder in Medicare,” says Ubl. “It will bring greater transparency and timeliness to the coverage process.”

Attorney Grant Bagley, a partner at Arnold & Porter (Washington, DC) notes, however, that “the problem with CMS is not the point of contact but the point of action. I like this idea only if it leads to some action.”

The legislation also calls for national coverage decisions to be made in nine months, or 12 months if referred to the Medicare Coverage Advisory Committee or another outside organization. Currently, the average coverage decision takes 18 months. 

In most cases, this is a positive development, but in some cases it may not be, says Slurzberg. “The concern is that there are times when a longer review time may be warranted,” she adds. “In an effort to comply with the time frame, will it be easier for CMS to say no rather than to do two or three extra months of work on a decision?” 

One goal of the bill, to “promote consistency of local coverage decisions,” could have adverse consequences, especially for small manufacturers that have relied on getting favorable coverage decisions from one or a handful of local contractors and then trying to expand from there. 

“If more consistency between local coverage decision makers reduces local flexibility and makes it harder to get a decision at one local contractor, that could make it harder for new technologies to get in at the local level,” says Wallfisch. “This is a top concern for innovative small manufacturers because they don't truly have access to national coverage decision making. It's too high-stakes for small manufacturers with one or two products.” 

The bill's establishment of a competitive bidding process is also not favored by industry, but it does include some limits that the sector's trade associations wanted. These include restricting the process mostly to durable medical equipment, exempting Class III devices, getting industry representation on the relevant advisory panels, and requiring more than one “winner.” “We will continue to watch this to make sure it leaves enough of a favorable atmosphere to support innovation,” Wallfisch says. “It is a potential barrier. These changes are almost solely based on cost and do not look at all at downstream cost savings.” 

Ubl agrees and notes that how CMS defines the “commodity products” that are subject to the process will be crucial. “The last thing we want to see is quality rationing,” he says. “We will be aggressively working to make changes in the legislation and to exercise our due process in regards to implementation.” 

A common thread throughout the legislation, however, is making CMS and its processes less of a mystery. “Now, when CMS takes a decision to an advisory committee, it will have to publish its decision and all of the information it relied upon,” says Bagley. “It's no longer ‘we took it to unnamed experts who don't agree with you.' A lot of things will now be put out in the open, and firms will have more ability to get help during the process.”

And a common opinion among industry is that the new law is only the beginning of an improved CMS. “While this legislation represents a meaningful start, we remain hopeful that the Medicare program will focus its future efforts on delivering more dollars to direct patient care,” says Collins.

Copyright ©2004 Medical Device & Diagnostic Industry